1. Yes, it's possible that someone could be seeing all of your traffic on a public wireless network.
2. I've never used this program so I can't comment. The reviews I've seen are a mixed bag, half love it, half hate it.
3. Yes, encrypted traffic is safe, as long as ALL content for the page is encrypted and you trust the site's certificate (meaning it's verified by a reputable source and you don't get a dialog box asking you if it's legit).
4. Probably. But not every VPN is built the same, so I can't definitely say for certain.
That being said, nothing is perfect. So if you're accessing a service online that contains sensitive data, I'd still just wait until you get home.